New Zealand markets open in 8 hours 49 minutes
  • NZX 50

    12,090.93
    +123.21 (+1.03%)
     
  • NZD/USD

    0.6449
    +0.0016 (+0.25%)
     
  • ALL ORDS

    7,709.70
    +23.60 (+0.31%)
     
  • OIL

    79.38
    +0.51 (+0.65%)
     
  • GOLD

    1,944.30
    -1.00 (-0.05%)
     

Market Sentiment Around Loss-Making Tritium DCFC Limited (NASDAQ:DCFC)

Tritium DCFC Limited (NASDAQ:DCFC) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Tritium Pty Ltd. designs, manufactures, and supplies DC chargers for electric vehicles, power-electronic systems, and battery energy-storage applications for customers in the United States, Europe, Australia, and internationally. On 30 June 2021, the US$1.1b market-cap company posted a loss of US$63m for its most recent financial year. As path to profitability is the topic on Tritium DCFC's investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

Check out our latest analysis for Tritium DCFC

Tritium DCFC is bordering on breakeven, according to the 2 American Electrical analysts. They anticipate the company to incur a final loss in 2022, before generating positive profits of US$50m in 2023. So, the company is predicted to breakeven just over a year from now. How fast will the company have to grow each year in order to reach the breakeven point by 2023? Working backwards from analyst estimates, it turns out that they expect the company to grow 58% year-on-year, on average, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

earnings-per-share-growth
earnings-per-share-growth

Given this is a high-level overview, we won’t go into details of Tritium DCFC's upcoming projects, however, keep in mind that generally a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

One thing we would like to bring into light with Tritium DCFC is it currently has negative equity on its balance sheet. Accounting methods used to deal with losses accumulated over time can cause this to occur. This is because liabilities are carried forward into the future until it cancels. Oftentimes, losses exist only on paper but other times, it can be a red flag.

Next Steps:

There are too many aspects of Tritium DCFC to cover in one brief article, but the key fundamentals for the company can all be found in one place – Tritium DCFC's company page on Simply Wall St. We've also put together a list of important factors you should further research:

  1. Valuation: What is Tritium DCFC worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Tritium DCFC is currently mispriced by the market.

  2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Tritium DCFC’s board and the CEO’s background.

  3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.